Accredited Investors that pass the Financial Assets Test are considered type (j) or (j.1) under NI 45-106
Accredited Investor Type (j): an individual who, either alone or with a spouse, beneficially owns financial assets having an aggregate realizable value that, before taxes but net of any related liabilities, exceeds $1 000 000,
(j.1): an individual who beneficially owns financial assets having an aggregate realizable value that, before taxes but net of any related liabilities, exceeds $5 000 000,
CRITERIA:
• the investor, as an individual or together with a spouse, has liquid financial assets (after liabilities) of more than $1 million
• the issuer obtains a signed risk acknowledgement in prescribed form (Form 45-106F9) from the investor
INCLUDES:
Assets:
• cash
• securities
• moneys owing under an insurance contract (a claim about to be paid or cash surrender value of a whole life policy)
• deposit or an evidence of a deposit that is not a security
• investments including RRSPs, spousal RRSPs, GICs, alternative investments, investment accounts (but not including Group RRSPs)
• money held on the investors’ behalf by a trustee so long as the investor has control and gets the clear benefit of the money in the trust
Liabilities:
• loans, lines of credit, margin, or other obligations which are used to finance investments (any investments, not necessarily the investment in question)
EXCLUDES:
Assets:
• real estate
• automobiles, boats, other recreational vehicles
• other fixed assets
• Group RRSPs
Liabilities:
• mortgages, car loans, credit card debt
• any other obligations not used to finance investments